THE Philippines’ dairy imports are expected to drop by 15 percent this year due to currency devaluation, a report from the United Nations’ Food and Agriculture Organization (FAO) showed.
“Import contractions are likely in several other leading dairy importers, including the Philippines, Indonesia and Malaysia, mainly due to less-than-expected growth in food services sales and currency depreciations,” FAO said.
In its biannual food outlook report, FAO noted that inbound shipment of milk and other dairy products to the Philippines is expected to drop by 15 percent to 2.3 million metric tons (MT).
This figure is lower than last year’s estimated import volume of 2.18 million MT.
In an earlier forecast, the agency said the country was expected to purchase 2.9 million MT of dairy products this year.
In a separate report, the United States Department of Agriculture (USDA) said that the Philippines was seen producing more dairy milk next year as local consumption is increasing.
In its Global Agriculture Information Network report, the USDA forecasts Philippine dairy milk production to reach 29 million metric tons (MT) for 2024, higher than this year’s estimated volume of 28 million MT. World trade in dairy products, meanwhile, is forecast to hit 84 million MT in milk equivalents, a drop of 1 percent from the 2022 figures, FAO said.
“This decrease is underpinned by an anticipated drop in imports by Asia, principally China, on account of rising domestic production and increased stocks of imported dairy products,” it said.
Global production of milk is seen to reach 950 million MT in 2023, up 1.3 percent from the previous year’s 937.7 million MT, reflecting a foreseen production expansion in Asia, notably India and China.
“Much of the expected increase in global milk output in 2023 is driven by yield improvements and the continued rise in dairy cattle numbers, compensating for the increased slaughter of dairy cattle,” FAO added.
The United Nations agency said that international prices of dairy products dropped from January to September 2023, due to the decline in import demand amid ample stocks in importing countries. However, it noted that world dairy prices rebounded in October 2023, reflecting a surge in demand, coupled with tight supplies from Western Europe and concerns over the potential impact of El Niño.